Estate Planning

Your estate plan is a snapshot of you, your family, your assets and the tax laws in effect at the time it was created. All of these change over time, and so should your plan. It is unreasonable to expect the simple will written when you were a newlywed to be effective now that you have a growing family, or now that you are divorced from your spouse, or now that you are retired and have an ever increasing swarm of grandchildren! Over the course of your lifetime, your estate plan will need check-ups, maintenance, tweaking, maybe even replacing. So, how do you know when it’s time to give your estate plan a check-up?

Generally, any change in your personal, family, financial or health situation, or a change in the tax laws, could prompt a change in your estate plan.

A will or a last will and testament is a legal document that tells the probate court how you want your property distributed after you die, and who has the power and responsibility to wrap up your affairs. Through the probate process the court will give the executor of your will the authority to gather all of your property, pay any remaining creditors, bills, and distribute your remaining property as you specify in your will.

A pour-over will is a will with a safety net provision that ensures that any property you fail to transfer to your living trust during your life will be transferred to your trust through the probate process. It will transfer all non-trust assets to your trust that are not controlled by beneficiary designations or by ownership with a joint tenant. Your goal is to avoid probate by ensuring that your pour-over will controls nothing. You must transfer all your assets to your trust during your life to avoid probate. Your will is merely your backup to ensure that all your assets are ultimately controlled by your living trust. Because the will takes effect only after a court determined that it is a valid document, a judge must act before your executor can step in and manage your estate.

Perhaps the most common type of trust is the revocable living trust. As the name implies, revocable trusts are fully revocable at the request of the trust maker. Thus, assets transferred (or funded) to a revocable trust remain within the control of the trust maker; the trust maker (or trust makers if it is a joint revocable trust) can simply revoke the trust and have the assets returned. Revocable trusts can be excellent vehicles for disability planning, privacy, and probate avoidance.